IRS Commissioner Daniel Werfel told the Senate Finance Committee April 19 that the agency was fully committed to transparency in its audit practices and would reveal more details this week on how the nation’s tax collector plans to use the $80 billion provided by the Inflation Reduction Act (PL 117-169).
Addressing the Committee for the first time officially as commissioner, Werfel said more details were forthcoming on the agency’s spending plans. Addressing another issue on Senators’ minds were audits, and who would come under IRS scrutiny. Last year, Treasury Secretary Janet Yellen issued a directive that the IRS will not increase audit rates, relative to historic levels, for small businesses and households making under $400,000, which Werfel said he is committed to meeting.
“Our compliance efforts will focus on complex issues and high-dollar noncompliance,” Werfel said. “We will hold ourselves accountable to achieving the plan vision by regularly monitoring and reporting to Congress on our progress. We will also update the plan’s details as we learn more about what works and as the operating environment changes.”
The plan is organized around five objectives:
• Dramatically improve services to help taxpayers meet their obligations and receive the tax incentives for which they are eligible.
• Quickly resolve taxpayer issues when they arise.
• Focus expanded enforcement on taxpayers with complex tax filings and high-dollar noncompliance to address the tax gap.
• Deliver cutting-edge technology, data, and analytics to operate more effectively.
• Attract, retain, and empower a highly skilled, diverse workforce and develop a culture that is better equipped to deliver results for taxpayers.
Along with improving the taxpayer experience, another component of the plan involves enforcement to ensure fairness in tax administration and address the tax gap, according to Werfel. “This focus will not be a concern to compliant taxpayers; the emphasis will be on pursuing those who do not follow the tax law,” he said.
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